What are Blockchain Layers? Scalability of Blockchain

The market for cryptocurrency and blockchain technology has grown at a rapid pace in recent years. The explosion of Blockchain makes more people concerned about the limitations of this technology trend. In this article, let's learn about Blockchain Layers and blockchain scalability with Market247.io.

What is blockchain scalability?

The scalability of the blockchain refers to an increase in the system's processing speed, as measured by the number of transactions per second. Widespread adoption of cryptocurrencies in daily life, blockchain layers are now required to improve network security, record keeping, and other functions.

The number of transactions processed by a system per second is called throughput. It is a fact that while the VisaNet electronic payment network has a processing speed of up to 20,000 transactions per second, the Bitcoin main chain cannot handle more than 7 transactions per second.

Blockchain is the first layer in a decentralized ecosystem. Layer 2 is a third-party integration used in conjunction with layer 1 to increase the number of nodes and, as a result, increase system throughput. More blockchain layer 2 technologies are being implemented. Smart Contracts are used in these solutions to automate transactions.

Blockchain developers are trying to expand the scope of blockchain governance as Bitcoin becomes a more important force. They hope to be able to reduce processing time and increase TPS by developing blockchains layer and optimizing layer 2 scalability.

Structure of blockchain layers

Blockchain technology is a great combination of technologies that work in tandem to keep the network running smoothly. Mathematical computing, cryptography, peer-to-peer networking, and authentication protocols come together to support the operation of the blockchain.

Blockchain is designed to be layered to support transaction validation. There are 5 levels involved, each with its own role.

Hardware infrastructure layer

Blockchain data is stored on extremely secure data servers. The first layer of the blockchain includes hardware such as the network connection, the computers in the network, and the data server. Users can connect with other users in a peer-to-peer network and share data. Blockchain is a peer-to-peer network of computers that automatically calculate, validate, and record transactions in a shared ledger. From there form a distributed database, which stores all the information, transactions and other data. Where, a node is a computer in a P2P network.

Data Layer

Blockchain is a long chain of blocks that store transaction data. When a certain number of transactions are validated by the nodes, the data is pooled into a block, uploaded to the blockchain, and linked to the previous block. The only block that is not linked back to another block is called the genesis block.

Each transaction written on this block is secured by private and public keys. The private key is a digital signature held only by the owner to authorize the transaction, while the public key is used to authenticate who signed the transaction. Every transaction will be digitally signed via the private key from the sender's wallet.

Network Layer

Thanks to the built-in peer-to-peer network that allows multiple nodes to transmit transaction information to reach an agreement on the legitimacy of the transaction. This supports fast communication, every node on the network has the ability to discover other nodes. The network layer supports linking these nodes.

Consensus Layer

The consensus layer is the main layer in the blockchain. This layer has the function of validating the transaction and if it does not complete, the entire network will fail. This layer is responsible for the protocol, which requires certain nodes to validate transactions. So, if the transaction is performed by a large number of nodes, all must come to the same conclusion and agree on the authenticity of the transaction.

Adopting this approach helps the blockchain to stay decentralized as no node has control. This is the consensus mechanism in blockchain.

Application layer

This layer is where smart contracts and DApps are stored. The application layer protocols are further subdivided into application and implementation layers. The application layer consists of the programs that end users will use to be able to communicate with the blockchain network.

Explain the meaning of blockchain layers

The Blockchain layers have the following meanings:

Layer 0

Blockchain Layer 0 is made up of components that help bring blockchain technology to life. This is the technology that allows Bitcoin, Ethereum and other blockchains to work. Components of the layer 0 blockchain include the Internet, hardware, and connections that enable the layer to run smoothly.

Layer 1

Layer 1 is the foundation layer and its security is based on its immutability. Layer 1 is in charge of the consensus processes, programming languages, when blocks are created, dispute resolution, and the rules and parameters that maintain the basic functions of the blockchain network. Bitcoin is one of the best examples of a layer 1 blockchain.

Layer 2

Blockchain layer 2 solutions are an overlapping network that sits above the base layer. Layer 2 is used by protocols to promote scalability by decoupling some interactions from the base layer. Therefore, smart contracts on the blockchain protocol are only responsible for handling deposit and withdrawal transactions, and at the same time ensuring that the offline protocols comply with the pre-existing principles.

It can be said that layer 1 is of the decentralized ecosystem, which is blockchain. Layer 2 is a third-party integration and operation of layer 1 to increase the number of nodes and thus, increase the system throughput. At the moment, many layer 2 blockchain solutions are being implemented.

Layer 3

The application layer is sometimes referred to as layer 3. Blockchain layer 3 projects act as the user interface while hiding the technical details of the communication channel.

Conclusion

Above is all the information about Blockchain layers that we want to give you. Market247.io believes that through this article, you have gained a lot of useful new knowledge. If you have any questions, don't forget to send us a message for a timely response.

FAQs

Is Solana Layer 1 or Layer 2?

Solana is a layer 1 blockchain designed to facilitate smart contracts and the creation of new decentralized applications (DApps).

Is there a layer 0 blockchain?

Blockchain Layers 0 is the initial stage of the blockchain that allows different networks to function, such as Bitcoin, Ethereum, etc. Layer 0 also provides the blockchain with a communication facility for top-down cross-chain interoperability across different layers.

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